cost transparency

RECENT POSTS

Website Brings Discounts, Cost Transparency to Dental Care

(Pepino1976/Flickr)

(Pepino1976/Flickr)

Like health care, dental care matters, too. While about 14 percent of Californians lack health insurance, 39 percent lack dental coverage, according to a 2009 brief from the California HealthCare Foundation.

Even if you have dental insurance, it often has coverage limits and varying levels of out-of-pocket spending requirements that differ from health insurance, as a recent Los Angeles Times report noted:

First, it’s specifically designed to encourage preventive treatment. That’s why most dental plans pay 100 percent for preventive services, such as cleanings, X-rays and checkups. Basic restorative services such as fillings and periodontal cleanings are generally covered at 80 percent, and you’ll commonly get just 50 percent reimbursement for procedures such as implants and crowns.

In addition, they commonly come with low annual maximums that place a cap on what the plan pays toward care — the typical range is $1,000 to $1,500.

Even with coverage, the high cost of dental procedures prevents many people from seeking care. In a recent study of Los Angeles residents conducted by Empirica Research, 51 percent with dental insurance say they’ve delayed care because of cost. That number jumps to 68 percent among those without coverage.

Now, a new website, Brighter.com, has launched a free (to consumers) service to help connect people with dentists — at a discount. “The mission was to provide quality, affordable care to everyone,” said Jake Winebaum, Brighter’s CEO. “Brighter is the first marketplace where dentists are competing for patients based on quality, price and convenience.” Continue reading

How Important Is Cost Transparency To Lowering Health Costs?

AetnaRate_Images Money_Apr62012

(flickr: Images Money)

The largest public employees retirement system in the country – CalPERS – has plenty to gain from a drop in health care costs. After all, they cover 1.6 million employees, retirees and their families in California.

Now they’re saying, they found a way to decrease the amount they’ve spent on knee and hip replacements by 19 percent in a year, which could have implications for other employer health plans.

Lisa Aliferis blogged about the CalPERS experiment in controlling costs right here on State of Health about a year ago. Aliferis wrote that they decided to tackle costs around these two surgeries, which cost them $55 million dollars a year in 2008.

Now, you might not think there would be much difference in the price for getting a knee or hip replacement across the state. But think again. CalPERS asked Anthem Blue Cross — which manages its PPO plans — to examine the range of prices for these operations in California.

Anthem came back with the startling information that CalPERS was paying $15,000 on the low end to $110,000 on the high end, a more than seven-fold difference from lowest to highest.

“So we started asking ourselves,” Kathy Donneson, Chief of the CalPERS Heatlhy Plan Administration Division told me, “what are we getting from the $110,000 surgery that we couldn’t get from the $15,000 surgery?”

That’s when CalPERS turned to what’s called a “value based purchasing” approach for elective hip and knee replacements, starting with its non-Medicare population. CalPERS set a threshold price of $30,000 for the hospitalization and device charges for these operations. That $30,000 is slightly higher than the average price CalPERS had been paying for a hip or knee replacement. Anthem identified 46 hospitals across the state which would do these operations at the threshold price.

Continue reading